115 State-to-State Variation in Medicaid and Medicare Reimbursement: Implications for Healthcare Access Among Vulnerable Populations

Abstract

INTRODUCTION: Medicaid and Medicare are social insurance programs providing coverage for specific populations, namely low-income and aged individuals. While Medicare is a federally indexed health insurance program, Medicaid is largely administered by individual states resulting in varying policies and practices. METHODS: Maximum allowed physician reimbursement fees for twenty common neurosurgical codes were obtained from the 2022 Medicare Physician Fee Schedule and individual state Medicaid Fee-for-Service Schedules. The Medicaid-Medicare Index (MMI), which measures Medicaid reimbursement as a fraction of Medicare allowed amounts, was calculated for each procedure across 49 states and the District of Columbia. MMI <1 or >1 indicates that Medicaid reimburses less than or greater than Medicare, respectively. The proportion of providers accepting new Medicaid patients and total Medicaid enrollment were compared across states as a function of MMI. RESULTS: Maximum allowed amounts for Medicare reimbursement (CV = 0.09) were less variable than Medicaid (CV = 0.26, p < 0.01). The average national MMI was 0.79 with a range of 0.37 in NY/NJ to 1.43 in NE. The largest absolute disparity was observed for intracranial aneurysm clipping in NY, where the maximum Medicaid reimbursement is $3,496.52 less than that of Medicare. Higher MMI was associated with a significantly larger proportion of providers accepting new Medicaid patients (R2 = 0.43, p < 0.01). Moreover, MMI varied inversely with the number of Medicaid beneficiaries (R2 = 0.12, p = 0.01). CONCLUSIONS: Medicaid reimbursement varies drastically between states reflecting the disparate methods of fee calculation. Lower reimbursement is associated with more limited provider enrollment, especially in states with a greater number of beneficiaries. While more limited access to Medicaid-accepting neurosurgeons may contribute to poorer outcomes, this is an issue that warrants further exploration.